Bankruptcy judge: Oakland, Macomb must respond to Wayne County filing to resume tabled water authority talks

A bankruptcy judge on Friday ordered Oakland and Macomb counties to respond to an appeal from neighboring Wayne County to re-opening the paused discussions to form a regional water authority.

The order, from Judge Steven Rhodes, comes following a motion filed by Wayne County on Thursday Rhodes to allow Chief District Judge Gerald Rosen to mediate talks over the future of the Detroit Water and Sewerage Department, or DWSD, essentially bringing all parties back to the table.

“Although negotiations between the counties and the city have occurred, ... (they) have not yet reached a conclusion, and need to be accelerated,” reasoned Wayne’s attorneys, Bloomfield Hills-based Butzel Long, in the filing.

Advertisement

“Instead, the negotiations are now at the ‘angry letter’ state, which has not produced any progress in negotiations.”

Oakland and Macomb have until April 16 to file responses and a hearing on the issue will be held April 17 in front of Rhodes.

The DWSD, which provides water treatment for nearly half of Michigan’s population, has been a major point of contention between the suburbs and the city on the larger stage throughout the municipality’s bankruptcy.

Detroit’s Emergency Manager Kevyn Orr has said he wants to form a regional water authority to be leased to Oakland, Macomb and Wayne counties, in which he proposed a 10-year, $47 million yearly payment to the city’s general pension fund paid by the suburban communities. On Monday, Oakland, Macomb and other entities filed objections to the city’s amended disclosures of the water department’s finances, and the county’s leaders have moved money to search for other options.

The developments come as a small act on a larger bankruptcy stage, as Detroit and its creditors daily update the evolving story with offers on the city’s Detroit Institute of Arts masterpieces and potential deals on millions in bonds.

Keith Lerminiaux, Oakland County’s corporation counsel, said Detroit’s attorneys on the day of Wayne County’s motion itself took the position that forming a regional authority is “off the table,” so there’s really nothing to mediate.

“We are faced with our present predicament because the EM’s team has steadfastly refused to: a) provide us with current financial information necessary to do due diligence, including audited financial reports which are required to be filed by law; and b) negotiate in good faith with us,” said Lerminiaux on Friday. “We’re pretty frustrated at the process.”

Detroit’s attorneys have not yet filed a response, and representatives from Detroit’s Emergency Management team did not immediately respond to requests for comment.

About the Author

John Turk covers the police beat and the Oakland County Board of Commissioners for The Oakland Press. He is a graduate of Eastern Michigan University. Reach the author at john.turk@oakpress.com
or follow John on Twitter: @jrturk.